BLBG:Asian Currencies Approach Eight-Month High on Japan Easing Bets
Asian currencies strengthened, approaching an eight-month high, as speculation Japan will take further measures to stimulate its economy spurred demand for riskier assets.
Exports from Japan slid 10.3 percent in September from a year earlier, increasing the odds the central bank will ease monetary policy at its next review on Oct. 30. The Bank of Japan last expanded its asset-buying program by 10 trillion yen ($125 billion) on Sept. 19. South Korea’s won rose to a 13-month high as the outcome of Spanish regional elections boosted optimism Europe will be able to contain its debt crisis.
“Expectations of looser monetary policy in Japan are increasing risk appetite,” said Chua Hak Bin, an economist at Bank of America Merrill Lynch in Singapore. “With the Hong Kong and Thailand markets shut for public holidays, trading is expected to be quiet today.”
The Philippine peso appreciated 0.2 percent to 41.30 per dollar as of 10:40 a.m. in Manila, according to data compiled by Bloomberg. The won gained 0.2 percent to 1,102.20 and Taiwan’s dollar rose 0.2 percent to NT$29.261. The Bloomberg-JPMorgan Asia Dollar Index, which tracks the region’s most-active currencies, touched 117.67, near the 117.87 level reached on Oct. 17 that was the highest since Feb. 3.
Spanish Prime Minister Mariano Rajoy’s People’s Party won 41 of the 75 seats in the regional assembly in Galicia, clearing one obstacle in the way of a financial bailout for Spain. The yen weakened past 80 against the dollar and the euro was little changed after advancing 0.3 percent yesterday.
Taiwanese Rebound
“The euro gaining after Spain’s regional elections, and the weakening of the yen, a typical safe asset, are supporting Asian currencies today,” said Han Sung Min, a Seoul-based currency trader at Busan Bank.
A government report today may show Taiwan’s industrial output expanded 6.5 percent in September from a year earlier, compared with a 1.9 percent increase in August, according to the median estimate of economists in a Bloomberg News survey. The island’s gross domestic product increased 1.7 percent in the three months through September from a year earlier, after shrinking 0.2 percent in the previous quarter, according a separate Bloomberg survey before preliminary data due Oct. 31.
“The Taiwan dollar could end stronger,” said Wai Ho Leong, a regional economist at Barclays Plc. in Singapore. “The theme is tech recovery. The Korean won tried to break 1,100 this morning and sentiment may spill over to Taiwan, which is the other tech producer which will benefit from product launches in the fourth quarter.”
Yuan Rises
Thai exports probably shrank for a fourth month in September, while South Korea’s economy grew 1.7 percent in the third quarter, the slowest pace in three years, separate Bloomberg News surveys showed before official data due this week.
The yuan rose 0.04 percent to 6.2519 per dollar even as the the People’s Bank of China set the currency’s daily fixing weaker for a third day.
Elsewhere, Malaysia’s ringgit was little changed at 3.0507 per dollar. Indonesia’s rupiah dropped 0.1 percent to 9,616, while Vietnam’s dong was steady at 20,850. Financial markets in Hong Kong and Thailand are closed today for holidays.
To contact the reporters on this story: Jiyeun Lee in Seoul at jlee1029@bloomberg.net Elffie Chew in Kuala Lumpur at echew16@bloomberg.net.
To contact the editor responsible for this story: Amit Prakash at aprakash1@bloomberg.net
